In countries where fixed-mobile convergence (FMC) is established, more than 60% of broadband customers benefit from faster speeds, higher quality connectivity and a greater range of converged products
FMC has enabled operators to deliver better customer outcomes with greater loyalty, reduced churn (down more than 30%), higher satisfaction scores (an average increase in NPS of +18.5%) and better value through faster broadband speeds and greater mobile data allowances
Countries where fixed and mobile operators have come together and where there are two strong competitors have seen significant investment in infrastructure and network quality resulting in almost 80% coverage of 100Mbps or faster broadband
London, UK – 26 January 2020 – Assembly Research today announces the findings of a pan-European market study of FMC in the telecoms sector. This study, commissioned by Liberty Global and Telefonica, demonstrates that consumers benefit from faster speeds and better value connectivity through high adoption of fixed-mobile converged products, with FMC operators able to deliver higher network investment and a higher contribution to GDP.
FMC refers to the ability of telecoms companies to provide their customers with products and services which draw on access to both fixed line and mobile networks and allow customers to benefit from the convenience of having their connectivity products with one provider. Specifically, “full” FMC occurs when a provider owns its own fixed broadband and mobile networks and offers consumers products which span both, rather than “light” FMC where a provider rents network capacity from another through a ‘Mobile Virtual Network’ structure. In markets where FMC is more developed, there are often two competing providers both owning their own network infrastructure.
In the truest sense, the UK has not yet seen a competitive converged offering for consumers. The trend towards greater access to converged products is firmly in line with the UK’s broader objectives of increasing access to next-generation connectivity such as gigabit broadband and 5G, particularly at a time when more people than ever are working from home.
Having performed a deep-dive market analysis in France, Netherlands, Spain and Portugal, we have found positive consumer demand for a converged product offering which has grown consistently since these products were first introduced. In these markets, consumers win as a result of greater innovation and better value. This holds true both for countries where price competition has been more aggressive (France and Portugal), and for countries where operators have been able to take a ‘more-for-more’ approach (Netherlands and Spain).
Our study shows French consumers can access broadband speeds nearly 60 times higher than prior to FMC, and consumers in Spain can get an FMC product with broadband 47 times faster than before. FMC has also spurred greater network investment from operators, with over 77.5% of households across France, the Netherlands, Portugal and Spain covered by 100Mbps connections last year.
Matthew Howett, Principal Analyst & Founder of Assembly, said:
“When faced with the data and evidence from other markets, it’s clear that, through fixed-mobile convergence, consumers see a range of more attractive propositions, greater value, and access to the best of fixed and mobile networks. The evolution of these offerings over time has seen the majority of consumers in the countries analysed decide to opt for a converged product. The resulting improvements seen in network quality and build have also led some of these very countries to be considered benchmarks when it comes to policies for encouraging the deployment of gigabit capable networks.”
Manuel Kohnstamm, Chief Corporate Affairs Officer at Liberty Global, and Eduardo Navarro, Chief Strategy and Corporate Affairs Officer at Telefonica, said:
“Both our organisations firmly believe that consumers win through fixed-mobile convergence, through better and more innovative products, greater satisfaction and a marked increase in value. We have seen these trends in the other markets in which we operate around Europe, supported by Assembly’s findings, and we are hugely excited about the opportunity to bring next-generation digital connectivity and a leading converged offer to consumers and businesses in the U.K.”
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Note to Editors:
A copy of study can be downloaded here, and an accompanying Analyst Note can be downloaded here.
Media Contacts:
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About Assembly:
Assembly is an independent analyst firm providing subscription-based information, analysis and commentary on regulatory, policy and legislative developments that affect communications markets and the wider digital economy.
For more information visit assemblyresearch.co.uk
About Liberty Global:
Liberty Global (NASDAQ: LBTYA, LBTYB and LBTYK) is one of the world’s leading converged video, broadband and communications companies, with operations in seven European countries under the consumer brands Virgin Media, Telenet, UPC, the combined Sunrise UPC, as well as VodafoneZiggo, which is owned through a 50/50 joint venture. Our substantial scale and commitment to innovation enable us to invest in the infrastructure and digital platforms that empower our customers to make the most of the digital revolution.
Liberty Global delivers market-leading products through next-generation networks that connect customers subscribing to 50 million broadband, video, fixed and mobile telephony services across our brands. We also have significant investments in ITV, All3Media, ITI Neovision, LionsGate, the Formula E racing series and several regional sports networks.
About Telefonica:
Telefónica is one the largest telecommunications service providers in the world. The company offers fixed and mobile connectivity as well as a wide range of digital services for residential and business customers. With 344 million customers, Telefónica operates in Europe and Latin America. Telefónica is a 100% listed company and its shares are traded on the Spanish Stock Market and on those in New York and Lima.
